AMENDED AND RESTATED
                              EMPLOYMENT AGREEMENT
                              ---------------------

         THIS  AGREEMENT is dated as of December 28, 2002,  between TASTY BAKING
COMPANY,  a  Pennsylvania  corporation  (the  "Company"),  and  JOHN M.  PETTINE
("Executive").
                               W I T N E S S E T H
         WHEREAS,  Executive  has served as Executive  Vice  President and Chief
Financial  Officer of the Company and, as such, has made and is currently making
a significant contribution to the Company's business; and
         WHEREAS,  in anticipation of the Executive's  retirement,  the Board of
Directors of the Company (the "Board")  desires to appoint a new Chief Financial
Officer; and
         WHEREAS, the Board believes that the continued services of Executive as
an employee will be of great value and importance to the Company and is desirous
of ensuring the  continuation  of Executive's  services for a period of years to
contribute to a smooth transition of duties to the new Chief Financial  Officer,
and to perform such other tasks as the Board may deem appropriate; and
         WHEREAS,  Executive  and the Company are  currently  obligated  under a
certain Employment Agreement dated as of July 1, 1988; and
         WHEREAS, Executive and the Company are willing to enter into an amended
and restated employment agreement upon the terms and conditions set forth below;
         NOW,  THEREFORE,  in  consideration  of  the  mutual  covenants  herein
contained  and of the mutual  benefits  herein  provided,  and  intending  to be
legally bound hereby, the Company and Executive hereby agree as follows:

<PAGE>


         Section 1. Term of Employment.  The Company hereby employs Executive as
Executive Vice President and Chief Financial Officer, and Executive accepts such
employment  by the  Company in each  case,  on the terms and  conditions  herein
contained and subject to termination  only as  hereinafter  provided (the period
from the date  hereof  through  termination  of this  Agreement  as  hereinafter
provided is referred to as the "Employment Period").  Executive acknowledges and
agrees that he shall retain the title and  responsibilities  of Chief  Financial
Officer only until such time as the newly elected Chief Financial  Officer takes
office and assumes his responsibilities.  Thereafter,  Executive will retain the
title of "Executive Vice President."

         Section 2. Duties.  During the Employment Period,  Executive shall have
such duties,  responsibility  and  authority  and perform such  services for the
Company as are consistent with Executive's  background,  training and experience
as may from  time to time be  assigned  to  Executive  by the  Board.  After the
appointment of the new Chief Financial Officer, Executive's duties shall include
assisting in the smooth  transition  of management  responsibilities  to the new
Chief Financial Officer.

Section 3. Compensation.

                  (a) Commencing on December 29, 2002 and thereafter during the
Employment Period, the Company shall pay Executive a base salary at the annual
rate of $223,000.00, which amount may be increased from time to time in
accordance with the Company's existing policy regarding general increases at the
discretion of the Board. Payment shall be made in accordance with the Company's
regular practice for Senior Executive employees as in effect from time to time.

                                      -2-

<PAGE>


                  (b) In addition to Executive's base salary,  as increased from
time to time, Executive shall be entitled to participate in the normal course of
business  in the annual  Management  Incentive  Bonus Plan of the Company and to
receive  such bonus  payments  as are  customarily  granted  for the  purpose of
providing additional compensation to Senior Executives.

         Section 4. Additional Terms.

                  (a) The Company will reimburse Executive for all reasonable
expenses properly incurred by Executive in the performance of Executive's duties
hereunder in accordance with policies established for Senior Executives of the
Company from time to time by the Board.

                  (b) During the Employment Period, Executive shall be entitled
to participate, in accord with the terms thereof, in any present or future
bonus, insurance, pension, SERP, Thrift, ESOP, stock option (whether incentive
or non-qualified) or other employee benefit, compensation or incentive plan
adopted by the Company for Senior Executives generally.

                  (c) During the  Employment  Period,  the Company shall provide
Executive with the exclusive use of the automobile  (and bear all costs of fuel,
maintenance,  repairs and insurance thereon) as heretofore provided to Executive
by the  Company for  Executive's  use, or a  replacement  automobile  of similar
prestige and appointments.

                  (d) Commencing July 1, 2004, Executive shall be entitled to
receive the benefit of the Company's wind down policy for management, set forth
in the Personnel Retirement Procedure in the Company's Policy-Procedure Manual,
whether or not such policy is then in effect.

         Section 5.Termination of Employment Period.

                  (a) The Employment  Period and the  Executive's  employment by
the Company shall cease and  terminate  upon the earliest to occur of the events
specified below:



                                      -3-
<PAGE>

                           (i) December 31, 2004.
                           (ii) The death of Executive. If Executive dies during
the term of this Agreement,Executive's salary  through  the end of the month in
which death occurs shall be paid to Executive's estate.

                           (iii) The Executive's election of early retirement
prior to the date applicable under Section 5(a)(i) for termination.

                           (iv) Termination of Executive's employment for
Cause. For these purposes "Cause" for termination of Executive shall be limited
to actions by Executive involving willful malfeasance or gross negligence or
failure to act by Executive involving willful and material nonfeasance which, at
the time of such willful malfeasance or gross negligence or willful and material
nonfeasance, would tend to have a material adverse effect on the Company.


                  (b) In the event that  Executive  becomes  "totally  disabled"
within the meaning of the Company's  Long Term  Disability  Plan, the Employment
Period shall be  suspended  (to resume  following  suspension  unless  otherwise
terminated)  during any period in which  Executive  is entitled to receive  long
term disability  payments under such plan and, during such period of suspension,
Executive shall not be entitled to any compensation  under Section 3 hereof, but
shall be entitled to the same  benefits  that any other  employee of the Company
would enjoy under the Long Term Disability Plan;  provided however,  in no event
shall the Employment  Period or suspension  thereof extend beyond the period set
forth in Section 5(a)(i) above.

                  (c)  Except  as  otherwise  expressly  provided  herein,  this
Agreement and all of the liabilities  and  obligations of the parties  hereunder
shall cease and  terminate  effective  upon the  termination  of the  Employment
Period.


                                      -4-
<PAGE>

                  (d) If (i) Executive's  employment  hereunder is terminated by
the  Company  other  than  pursuant  to  Section  5(a)  hereof,  (ii)  Executive
terminates  his   employment   hereunder   because  his  authority,   duties  or
responsibilities  are altered so as to be  inconsistent  with the  provisions of
Section 2 hereof and Executive's background,  training and experience,  or (iii)
Executive terminates his employment hereunder because of the Company's continued
failure to perform its duties hereunder in any material  respect,  which failure
has not been cured within 20 days after notice of such failure has been given by
Executive to Company,  then the Executive shall be entitled to receive,  in lieu
of all other damages to which Executive may otherwise be entitled as a direct or
indirect  result of the  termination of Executive's  employment in breach of the
terms hereof,  (A) the  compensation  which would otherwise have been payable to
Executive  under  Section 3 hereof  through  December  31, 2004 which would have
pertained,  (B) health and life insurance coverages provided by the Company from
time-to-time  to Senior  Executives  of the  Company at the cost of the  Company
through  December 31, 2004, and (C) supplemental  retirement  benefits under the
Executive's  Supplemental Executive Retirement Plan Agreement as modified by the
provisions set forth on Exhibit A hereto which modifications shall automatically
take effect upon Executive's  execution and delivery to the Company of a release
in the form attached as Exhibit B hereto  (provided such release is executed and
delivered  within 45 days after the  effective  date of the  termination  of his
employment)  and such release having become  effective under all applicable laws
after the revocation period set forth in paragraph (iv) of such release.  In the
event  that  Executive  fails to execute  and  deliver  the  release in a timely
fashion,  or such release shall not have become  effective  under all applicable
laws,  then Executive  shall not be entitled to the benefits under clause (C) of
the  preceding  sentence.  Payments  under  clauses (A) and (B) in the preceding
sentence shall be made no less often than monthly.


                                      -5-
<PAGE>


         Section 6.  Assignment.  This Agreement  shall not be assignable by the
Company except to a majority-owned subsidiary or parent entity of the Company or
to a successor  to the Company and its  business by way of merger,  acquisition,
purchase of assets or otherwise and this  Agreement is and shall be binding upon
and inure to the  benefit of any such  parent,  subsidiary  or  successor.  This
Agreement  shall not be assignable by Executive but it shall be binding upon and
inure to the benefit of Executive's heirs,  executors,  administrators and legal
representatives.
         Section  7.  Notices.   All  notices,   requests,   demands  and  other
communications  hereunder  must be in  writing  and shall be deemed to have been
given if  delivered by hand or mailed by first class,  registered  mail,  return
receipt requested, postage and registry fees prepaid, and addressed as follows:

       (e)      If to the Company, to:             Tasty Baking Company
                                                   2801 Hunting Park Avenue
                                                   Philadelphia, PA  19129
                                                   Attention:  Secretary

       (f)      If to the Executive, to:
                                                   John  M. Pettine
                                                   524 Sentinel Road
                                                   Moorestown, NJ 08057

Addresses may be changed by notice in writing signed by the addressee.

         Section  8.  Confidential  Information.  Executive  agrees to hold in a
fiduciary  capacity for the benefit of the Company all of the Company's business
secrets and confidential information, knowledge and data relating to the Company
or any of its affiliated companies and their respective  businesses,  which have
been  obtained by the Executive  during his  employment by the Company or any of
its affiliated companies, including without limitation,  information relating to
such matters as finances,  operations,  processes, product recipes, new products
in development, sales methods, equipment, techniques, plans, formulae, products,
methods  and  know-how,  customer  requirements  and  names  of  suppliers.  The
obligations under this Section 8 shall survive the termination of this Agreement
and any  termination  of Executive's  employment  with the Company or any of its
affiliates.  Executive's  obligations  under this  Section 8


                                      -6-
<PAGE>


shall not be deemed violated in the event that (i) Executive discloses any such
information pursuant to order of a court of competent jurisdiction or any
administrative, quasi-judicial or other body having subpoena power, provided
Executive has notified the Company of such potential legal order and provided
the Company with the opportunity to challenge or limit the scope of the
disclosure, or (ii) such information becomes generally available from a source
other than the Company, any of its affiliates, or any of their employees when
such source is legally entitled, to the best of Executive's knowledge, to make
such information available. Executive agrees that in the event of breach of any
of his obligations under this Section 8, Company shall be entitled to an
injunction restraining Executive from violating the provisions hereof and he
further agrees that an action for damages does not provide an adequate remedy
for his violation of this Section 8, in addition to any other remedies available
under this Agreement, under the law or in equity.


 Section  9.  Mediation/Arbitration.  Except as  provided  in  Section 8
above,  the  parties  shall  attempt to resolve any  dispute  through  mediation
conducted in Philadelphia, Pennsylvania. If the parties do not promptly agree on
a neutral mediator, then any of the parties may notify  J.A.M.S./Endispute,  345
Park Avenue,  New York,  New York, to initiate  selection of a mediator from the
J.A.M.S/Endispute Panel of Neutrals. The Company shall pay the fees and expenses
of the  mediator.  If the mediator is unable to  facilitate a settlement  of the
dispute within a reasonable  period of time, as determined by the mediator,  the
mediator  shall issue a written  statement to the parties to that effect and the
aggrieved  party(ies) may then seek relief through  arbitration,  which shall be
binding, before a single arbitrator pursuant to the Commercial

                                      -7-
<PAGE>


Arbitration Rules ("Rules") of the American Arbitration Association (the
"Association"). The place of arbitration shall be Philadelphia, Pennsylvania.
Arbitration may be commenced at any time by any party seeking arbitration by
written notice to the other party(ies) by first class mail, postage prepaid. The
arbitrator shall be selected by the joint agreement of the parties, but if the
parties do not so agree within (30) business days after the date of the notice
referred to above, the selection shall be made pursuant to the Rules from the
panels of arbitrators maintained by such Association, and such arbitrator shall
be neutral, impartial, independent of the parties and others having any known
interest in the outcome, shall abide by the ABA and AAA Code of Ethics for
neutral arbitrators and shall have no ex parte communications about the dispute
with either party. The arbitrator shall be required to follow applicable law and
render a written decision within one hundred eighty (180) days of appointment.
Any award rendered by the arbitrator shall be final, conclusive and binding upon
the parties hereto and there shall be no right of appeal therefrom. Any court
having jurisdiction thereof may enter judgment upon the award rendered by the
arbitrator. The costs and expenses of arbitration, including legal fees and
expenses of the arbitrator, shall be paid by the parties as the arbitrator may
assess. Each party shall pay his or its own legal fees and costs. The arbitrator
shall not be permitted to award punitive or similar type damages under any
circumstances. The procedures set forth in this Section 9 shall constitute the
sole and exclusive procedures for the resolution of any dispute under this
Agreement, except for any dispute related to an alleged violation of Section 8
hereof, in which case Company, without prejudice to or compliance with the
procedures set forth in this Section 9, is expressly permitted to institute
legal proceedings to obtain a temporary restraining order, a preliminary and
permanent injunction or other applicable relief.


                                      -8-
<PAGE>


Section 10. Miscellaneous.

This Agreement is the entire agreement and understanding between the parties
hereto and supersedes all prior agreements and understandings, oral or written,
relating to the subject matter hereof, and no change, alteration or modification
hereof may be made except in writing signed by both parties hereto. The headings
in this Agreement are for convenience of reference only and shall not be
considered as part of this Agreement nor limit or otherwise affect the meaning
hereof. This Agreement shall in all respects be governed by and construed and
enforced in accordance with the laws of the Commonwealth of Pennsylvania,
without regard to conflicts of laws or principles.


 IN WITNESS WHEREOF, the
parties hereto have executed and delivered this Agreement as of the date first
above written. ATTEST: TASTY BAKING COMPANY



                                     By:
---------------------------              -------------------------------------
Secretary                                Charles P. Pizzi, President and Chief
                                         Executive Officer


(SEAL)


---------------------------              -------------------------------------
Witness                                  John M. Pettine, Executive


                                      -9-
<PAGE>


                                    EXHIBIT A

                                   SERP INSERT

                              TASTY BAKING COMPANY


ARTICLE I.

         3. Early Retirement.
            ---------------
                  (a)  In  the  event  that  the  Employee   shall  elect  early
retirement  pursuant to the terms of the  Employer's  Pension  Plan, he shall be
entitled to receive  benefits in  accordance  with  paragraph 1 above,  but such
benefits  shall be reduced in the same  proportion as the benefits which are due
under the Employer's Pension Plan are reduced as the result of early retirement.
However,  in the event  that the  Employee's  employment  with the  Employer  is
terminated  prior to Employee's  reaching age 62, as provided in Section 5(d) of
that certain Amended and Restated Employment  Agreement dated as of December 28,
2002 between Employer and Employee ("Employment Agreement") for any reason other
than  death  or by  the  Employer  for  cause  (as  defined  in  the  Employment
Agreement),  Employer shall be obligated to pay additional  benefits to Employee
under this Agreement as follows:  if Employee elects to commence receiving early
retirement  benefits  under  the  Employer's  Pension  Plan on or after  age 62,
Employer  shall be obligated to pay benefits to Employee under this Agreement to
make  Employee  whole for any  actuarial  reduction in his  benefits  that would
otherwise be applicable  under this Agreement and under the  Employer's  Pension
Plan in excess of the  reduction  that would be  applicable  to  Employee  if he
terminated employment at age 62 and elected immediate early retirement under the
Employer's Pension Plan.



[Note: Modifications to SERPs approved by the Board April 22, 1988 shall also be
included.]




<PAGE>

                                   EXHIBIT "B"
                                  ------------
                                     RELEASE

                  KNOW ALL MEN BY  THESE  PRESENTS  that  JOHN M.  PETTINE,  for
himself,  and his agents,  representatives,  heirs,  executors,  administrators,
insurers,  successors  and  assigns,  and all  persons,  corporations  or  other
entities connected  therewith which might claim by, through or under them or any
of them (all of whom are hereby  individually  and  collectively  referred to in
this paragraph as "Releasors"),  do hereby release, remise and forever discharge
TASTY  BAKING  COMPANY,   its  respective  direct  and  indirect   subsidiaries,
affiliates,  investors, insurers, successors, assigns, and each of their agents,
servants,    shareholders,    employees,    officers,    directors,    trustees,
representatives and attorneys,  and each of their heirs,  successors,  executors
and  administrators  (all of whom are hereinafter  individually and collectively
referred to in this paragraph as  "Releasees"),  of and from any and all claims,
demands,  causes  of  action,  actions,  rights,  damages,   judgments,   costs,
compensation,  suits,  debts,  dues,  accounts,  bonds,  covenants,  agreements,
expenses, attorneys' fees, damages, penalties, punitive damages and liability of
any nature  whatsoever,  in law or in equity or otherwise,  which Releasors have
had,  now  have,  shall or may have in the  future,  whether  known or  unknown,
foreseen or unforeseen, suspected or unsuspected, by reason of any cause, matter
or thing whatsoever,  including those relating to Mr. Pettine's  employment with
Tasty Baking Company ("Company") and the termination of that employment,  except
as expressly provided in the immediately  following sentence to the date of this
Release.  Notwithstanding  anything  contained in this Release to the  contrary,
John M. Pettine does not release,  remise or discharge  the Releasees of or from
any claims which he may have under (i) the Company's qualified  retirement plans
or 401k plans;  (ii) that  certain  Supplemental  Executive  Retirement  Program
Agreement originally dated June 10, 1987 between the Company and Mr. Pettine, as
amended, and the rabbi trust with respect to such program; (iii) any plans which
the Company may have in effect from  time-to-time,  as they may be modified from
time-to-time,  to provide  medical and/or life  insurance  benefits to retirees;
(iv) that certain Amended and Restated Employment Agreement dated as of December
28, 2002  between Mr.  Pettine and the Company,  for damages  arising out of the
Company's  breach  thereunder,  but  limited  only to the  amounts  set forth in
Section 5(d) thereof,  all other damages being expressly  released,  and (v) the
indemnification  provisions contained in the Company's Articles of Incorporation
and/or Bylaws,  and/or any  indemnification  agreement in favor of Mr.  Pettine,
relating to indemnification of officers and/or directors.

                  This  paragraph and its  subparagraphs  are intended to comply
with section 201 of the Older Workers' Benefits Act of 1990, as amended.

                  (i)  By  the  execution  of  this  release,  John  M.  Pettine
acknowledges  that he is giving up all  claims  related to his  employment  with
Company and the  termination of that  employment,  including but not limited to,
claims for breach of  contract or implied  contract,  wrongful,  retaliatory  or
constructive  discharge,  negligence,   misrepresentation,   fraud,  detrimental
reliance,  promissory estoppel,  defamation,  invasion of privacy, impairment of
economic opportunity, intentional or negligent inflection of emotional distress,
any  and all  other  torts,  and  claims  for  attorney's  fees,  as well as the
following statutory claims described below.

                                      -11-

<PAGE>


                  (ii) John M. Pettine further  acknowledges  that various state
and federal laws prohibit  discrimination  based on age,  gender,  race,  color,
national origin, religion,  handicap or veterans status. These include Title VII
of the Civil Rights Act of 1964, 42 U.S.C. ss.2000e et seq. and the Civil Rights
Act of 1991 (relating to gender, national origin, and certain other kinds of job
discrimination);  the Age  Discrimination  in Employment  Act, 29 U.S.C.  626 et
seq., (relating to age discrimination in employment),  the Older Workers Benefit
Protection  Act, 29 U.S.C.  ss.626,  the  Rehabilitation  Act of 1973, the Civil
Rights  Act of 1866  and  1871,  the  Americans  with  Disabilities  Act and the
Pennsylvania  Human  Relations Act. He also  understands and  acknowledges  that
there  are  various  federal  and state  laws  governing  wage and hour  issues,
including but not limited to the Fair Labor Standards Act, Pennsylvania wage and
hour laws, and the Equal Pay Act of 1963 (relating to all the above forms of job
discrimination).  He  acknowledges  that he is giving up any  claims he may have
under any of these  statutes  and under any other  federal,  state or  municipal
statute, ordinance,  executive order or regulation relating to discrimination in
employment,  wage and hour issues,  or in any way  pertaining to his  employment
relationship  with Company.  He understands and  acknowledges  that this release
applies to all such  employment-related  claims  which he now has or may have to
the date of this Agreement.

                  (iii)  John M.  Pettine  hereby  certifies  that  Company  has
advised him that he has at least 21 days (a) to consider and review this Release
and its consequences with an attorney of his choosing, and (b) if he accepts the
terms of this Release, to forward an executed copy of this Release to Company in
accordance with Section 7 of his Employment Agreement.

                  (iv) John M. Pettine also acknowledges and understands that he
has seven (7) days from the execution of this Release to advise  Company that he
is revoking this Release, and understand that if he has not revoked this Release
by the end of the seven-day  period,  this Release will be effective and in full
force. He understands that any revocation he makes shall be in writing,  sent by
facsimile,  hand  delivery or  overnight  mail,  to Company in  accordance  with
Section 7 of his Employment Agreement.

                  (v) In the  event  that  his  acceptance  of this  Release  is
revoked (as set forth in the last  sentence of  paragraph  (iv)),  then he shall
immediately return to Company any payments made to him under Section 5(d) of his
Employment Agreement.

                  Releasor agrees that he will not, at any time  hereafter,  nor
will he permit, at any time hereafter,  any person acting under his direction or
control to,  initiate,  maintain,  or prosecute,  or in any way  knowingly  aid,
directly or indirectly, in the initiation,  maintenance,  or prosecution of, any
claim, demand, suit,  accounting,  or cause of action against the Releasees,  or
any of them,  arising out of, or in any way  connected  with any matter,  thing,
transaction,  occurrence,  act or  omission  with  respect to which a release is
being provided hereunder.

                  Nothing  herein is  intended to  foreclose  Mr.  Pettine  from
filing a charge with the Equal Employment Opportunity  Commission.  In the event
such a charge is filed,  Mr.  Pettine  shall be precluded  from  recovering  any
monetary relief or obtaining any other personal recovery.

                  If John M. Pettine, his heirs or personal representatives,  or
any person or entity  acting on their  behalf,  takes,  pursues or supports  any
action to determine that this Release,  or any

                                      -12-
<PAGE>


part hereof, or any other release contained in this Agreement is invalid and if
this Release, or any part hereof, or any other release contained in this Release
is determined to be invalid for any reason, then any obligations the Company may
have to Mr. Pettine pursuant to the Amendment to Supplemental Executive
Retirement Plan Agreement Between Tasty Baking Company and John M. Pettine shall
cease.

         IN WITNESS WHEREOF, and intending to be legally bound, the Releasor
hereto has executed and delivered this Release as of the _____ day of
___________________, 200_.


                                            -----------------------------------
                                            John M. Pettine


STATE OF                                    :
                                            :
COUNTY OF                                   :


                  On this, the ______ day of  _________________,  200__,  before
me, the  undersigned  officer,  personally  appeared JOHN M. PETTINE known to me
(satisfactorily  proven) to be the person whose name is subscribed to the within
instrument,  and acknowledged that he executed the same for the purposes therein
contained.

                  IN WITNESS WHEREOF, I hereunto set my hand and official seal.



                                    -----------------------------------
                                         Notary Public

                                    My Commission Expires:


                                      -13-